One more payment will settle Spruce Goose title

Evergreen Aviation Museum of McMinnville and the Aero Club of Southern California agree that one more payment is required before the Aero Club will relinquish legal ownership of Howard Hughes’ famous wooden airplane, the Spruce Goose. What remains is to settle on the amount of that payment.

Attorney Robert E. Lyon represents the Aero Club, which sold the Goose to Evergreen founder Del Smith in 1992. He said the California organization will hold title to the “flying boat” until the final payment is made, but stressed that the Aero Club is not interested in taking it back.

“I can tell you this; we don’t want it,” he told the News-Register. Lyon said it was too difficult in the 1990s to find a new owner for the plane, and many people with the necessary passions and connections in those days have retired or are deceased.

“We don’t have the connections to make a deal, plus you’ve got to find somebody with millions of dollars to dismantle and move the thing,” Lyon said. “That was part of the deal last time … you buy it, you move it.”

Lyon said the museum and the club have roughly a $30,000 difference of opinion about how much still is owned. As previously reported, the $500,000 purchase price was paid in full through annual payments over 20 years, and Evergreen owes a calculated amount based on museum earnings over the years.

“I got a call saying the treasurer will be in contact, and we’re going to straighten it out in the next week or so,” Lyon said. “I’m hopeful that we can get it squared away, because we can do a nice thing for your community by getting rid of these bad rumors.”

Evergreen Museum Director Larry Wood said Monday that he also expects the situation to be resolved soon, clearing the Spruce Goose title.

Lyon told the News-Register that payments to the Aero Club since 1992 were made by Evergreen Aviation. “I kept copies of some of them,” he said, “and we never received a single payment from the museum that I know of.”

The Aero Club, said Lyon, formed a for-profit corporation, Aero Exhibits Inc., specifically to hold ownership of the airplane and to handle the sale, Lyon said. It sold the plane — and the corporation — to Evergreen Ventures Inc. Within a day or two, said Lyon, Evergreen Ventures signed over the plane to the museum. In a complex deal, the museum then returned the corporate stock certificate and plane title to the Aero Club, as security, until all payments were made.

Despite negotiations over the last payment, and reports swirling about financial collapse of Evergreen Airlines, Lyon said he has confidence in promises from Wood about finalizing the deal.

“I do not believe that there’s any possibility that we’re going to get the flying boat back. I think the museum’s got everything under control. We’re just inches from the goal line of finishing up the accounting period,” Lyon said.

A statement released by the museum Friday reiterated previous assertions that the museum is doing well, and is not at risk.

“The Evergreen Aviation & Space Museum remains open to the public, is financial viable and has no plans to close,” it said. “The vast majority of the museum’s aircraft displays are unaffected by issues which may confront Evergreen Aviation and will remain at the museum.”

Evergreen’s statement Friday also noted that the company has cooperated fully with a state Justice Department investigation of whether the finances of the museum and Evergreen International Aviation were improperly mingled.

In December 2011, when the investigation began, a DOJ spokesman said the investigation involved “the financial relationship between the nonprofit and for-profit companies, as well as the governance of the nonprofit.”

Evergreen’s Friday statement said, “Out of deference to the Oregon Department of Justice review and its process, the museum will say only that the museum has cooperated with the Department of Justice in its review and that we are confident the Department of Justice would acknowledge our cooperation and the good work we have put into addressing concerns it has raised.”

Wood has said that a museum loan to Evergreen Aviation triggered the state investigation, but that the loan was promptly repaid with interest. He told the News-Register that the state wants the two entities to create more separation for certain business operations, and that the museum will have addressed all those concerns by early January.